TUESDAY, MAY 13, 2014

LONDON–Global markets will be more volatile as the world economy starts to recover from the financial and economic crisis, but this shouldn’t be confused with vulnerability, the head of the Central Bank of Brazil said Tuesday.

The global economy is “finally recovering from the lingering effects of the global financial crisis” and international monetary conditions are beginning “a process of normalization,” Alexandre Tombini said in a speech to the Brazilian Chamber of Commerce in Great Britain.

This process is already under way in the U.S., he said, referring to the Federal Reserve’s move to reduce its bond-buying program.

Brazil has been identified by some as one of the countries most likely to suffer the consequences of the so-called “tapering” by the Fed, and the Brazilian currency has depreciated sharply over the last two years.

While this move toward normalization likely will be an uncomfortable ride for global asset prices, including exchange rates, these moves were predictable and Brazil has taken steps to ensure it is more resilient to external shocks, he said.

“This realignment of asset prices should not be confused with vulnerability,” Mr. Tombini said.

Meanwhile, the official said Brazil must pursue reforms such as improving labor-force skills and expanding and updating infrastructure if it is to produce faster economic growth without driving up inflationary pressures.

“In Brazil, it is clear to us that we need to address mainly our well-identified supply constraints, our bottlenecks, to grow faster,” he said.

Over the last decade, he said, Brazil has created 18 million jobs in the formal economy and 40 million people joined the middle class.